George Alogoskoufis

A related article was published in Greek in the newspaper To Vima, on November 9, 2025, under the title Economic Impact and Risks of Artificial Intelligence.

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Artificial intelligence is no longer a futuristic concept. It’s here, embedded in our daily lives — in the way we shop, work, learn, and even think. As the world’s most powerful companies pour billions into AI, the technology is becoming the engine of a new economic revolution, one that promises extraordinary progress but also carries serious risks.

The Dawn of a New Economic Era

AI is already boosting productivity through automation and data analytics. Retailers use it to predict demand, banks to detect fraud, universities to personalize learning. The results are higher efficiency and lower costs. For now, the effect on GDP is modest — but the trajectory is unmistakably upward.

Still, the first wave of change has not come without disruption. Administrative and repetitive jobs are being replaced by algorithms. At the same time, new opportunities are emerging in data science, cybersecurity, and AI design. The transition, however, is uneven. For many workers, retraining and lifelong learning are no longer optional — they are survival skills.

Winners, Losers, and a Growing Divide

The early winners of this technological wave are large corporations with capital, expertise, and access to data. Small and medium-sized enterprises are struggling to catch up. That imbalance is widening the gap between firms and between workers — especially between those who can adapt quickly and those who cannot.

Regulators are also scrambling to keep up. Questions about privacy, data ownership, and the ethics of machine learning are forcing governments, particularly in Europe, to draft the first serious frameworks for AI oversight.

Meanwhile, investors are watching nervously. Stock prices of AI-related firms have soared to record highs, fueling fears of a bubble. As The Economist recently warned, America’s 20 largest companies now account for over half the value of the S&P 500, with most deeply invested in AI. If the technology fails to deliver the dazzling returns expected, a major financial correction — even a global recession — could follow.

The Great Reshuffle

Over the next decade, AI is expected to become a “general-purpose technology,” reshaping entire industries. The OECD predicts that by 2035, it could lift global GDP by as much as 10%.

But not everyone will benefit equally. Tech giants are likely to tighten their grip over data and computing power, reinforcing oligopolies and deepening inequality. High-skilled workers will see rising incomes; those with fewer skills may be left behind.

Governments will have to step in — with redistributive policies, fairer taxation of intangible capital, and heavy investment in education. The race for talent will be as important as the race for chips. The geopolitical balance is also shifting: the United States and China are pulling ahead, while Europe seeks to stay relevant through regulation and innovation.

Beyond Work: The Long View

Looking further ahead, the transformation could be far more profound. As artificial intelligence evolves toward so-called general intelligence — machines capable of creative and cognitive reasoning — the boundary between human and machine work will blur.

Automation may make many jobs redundant, while intangible assets like data, algorithms, and software become the key factors of production. Those who control them will wield unprecedented power. We may be heading toward a new form of “technological oligarchy,” where the issue is no longer how to produce wealth, but how to share it.

The solution could lie in new social contracts — from universal basic income to “digital dividends” distributed from data use. States will also need to guarantee access to knowledge, nurture creativity, and uphold ethical values — human traits that machines still cannot replicate.

A Choice Between Abundance and Inequality

AI holds the promise of an economy of abundance, where goods and services are produced at near-zero marginal cost and people enjoy more free time than ever before. But without rules, the same technology could entrench inequality and dependence on a handful of digital giants.

New forms of society could emerge, where work is no longer the central pillar of identity and belonging. Creativity, care, and innovation might replace traditional labor as the cornerstones of human contribution.

Globally, AI is set to redefine the balance of power. Nations that master it will gain economic and strategic dominance. Others will depend on them more than ever. International cooperation will be crucial to ensure AI is used not just for profit or competition, but also to tackle shared challenges — from climate change to public health.

Progress With a Human Face

As Nobel laureates Joel Mokyr, Philippe Aghion, and Peter Howitt have argued, technological progress thrives when the economy, science, and society reinforce one another. With the right rules and values, AI can accelerate human advancement rather than undermine it.

Whether artificial intelligence leads to prosperity and abundance — or to inequality and concentration of power — will depend not on machines, but on us.

The coming decades will test our political will as much as our technological imagination. The question is no longer whether machines can think, but whether humanity can use that intelligence wisely.

Link to the article in Greek in the newspaper To Vima